By Contributor,Kevin Rozario

Copyright forbes

Group effort: Lotte Duty Free has a long history in attracting group visitors. Here are approximately 4,000 Chinese incentive tourists visiting its Myeongdong flagship store last year.
Lotte Duty Free

South Korea’s duty-free retailers, which have suffered from poor sales recoveries in the post-Covid era, including this year, might have an easier time as a visa-free scheme for Chinese travelers comes into effect from Monday (September 29).

Under the revised set-up, the complex visa application process—which previously required five business days—has been simplified and now takes just 24 hours prior to departure as a visa-free option. It applies to Chinese tourists traveling as part of a group to South Korea, and makes it easier for them to book later, and/or find last-minute trips to Seoul and other cities in the country.

It is a sign of the times, and a sense of urgency, that the biggest travel retailer in the market, Lotte Duty Free has pounced on the change. CEO Kim Dong-ha, in post since November 2024 and recently-elected president of the influential Korea Duty Free Association, said that his company “will begin welcoming Chinese group tourists in earnest” from the 29th.

Lotte moves fast on visa changes

The first beneficiaries are cruise travelers on the Dream Cruise Line from Tianjin, China. Approximately 1,700 passengers, among the 2,000 who are onboard the ship, will take advantage of the visa-free policy (which has already come into effect due to a time difference of 13 hours between New York and Seoul).

Those travelers will visit Lotte Duty Free’s main downtown store in the tourist hub of Myeongdong in Seoul, Korea’s capital city. The Dream Cruise Line is scheduled to dock at Incheon Port, close to where the country’s main airport is also located.

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As well as Myeongdong, the cruise tourists will visit other Seoul attractions like Namsan, and include duty-free shopping as part of their itinerary. Next month, approximately 10,000 Chinese travelers are expected to visit Lotte’s duty-free stores in Seoul, Busan, and Jeju. This is due to China’s National Day holiday, typically lasting seven days and known as Golden Week because, pre-Covid, it was very lucrative for retailers. This year, the Mid-Autumn Festival holidays run back-to-back with Golden week, offering two bites of the cherry.

Visas and other factors at play

Lotte and rival duty-free retailers like Shilla Duty Free and Shinsegae, are also hopeful that a shift in exchange rates might work in their favor. Rates had made shopping in South Korea unfavorable for the Chinese in the past couple of years and they flocked to Japan instead, where the low Yen last year had boosted duty-free sales. Now that the Japanese currency is strengthening again, albeit inconsistently, South Korea can fight its corner more successfully, coupled with the visa-free scheme.

There is an expectation of more Chinese tourists visiting Korea and possibly spending a little more per head as well. November’s Asia-Pacific Economic Cooperation Forum (APEC) in Gyeongju, an annual meeting of leaders of member states is also expected to drive up visitors numbers through a ripple effect.

As well as focusing on attracting group tourists from China through pre-marketing efforts, Lotte Duty Free will home in on second- and third-tier Chinese cities where wealth has been steadily rising, driven by high investment. Recently, the company visited Guangzhou and Qingdao to strengthen cooperative relationships with major travel agencies and partners, and discussed specific collaborative measures to boost Korean tourism.

At the retail level, the travel retailer is accelerating the improvement of its infrastructure and services that are tailored to Chinese tourists, including an expanded product line-up of brands favored by them. Promotions for mobile payment options like Alipay and WeChat Pay will also play their part in helping visa-free travelers to part with their cash.

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